The Anatomy of a Catalyst Trade
Thanks for grabbing your copy of The Anatomy of a Catalyst Trade.
In this special report, I’m going to reveal my proprietary 4-Phase Formula that I used to identify my #1 Catalyst Trade for 2022 and beyond.
It’s deceptively simple but wildly effective.
Before we dive into my 4-Phase Formula, I want to take a moment to finally answer a question I’m sure you’ve had.
What the heck is a Catalyst?
I’m sure you have been dying to know since you signed up for the 2022 Profit Catalyst Symposium.
In short, a Catalyst is an unstoppable, tsunami-sized trend that’s at the tipping point of hitting the mainstream.
Here’s a list of Catalysts that have handed investors a shot at megabucks…
- The early railroad industry in the United States
- The development of the automobile industry
- The story of the discovery of electric light and its commercial exploitation
- The discovery and early development of crude oil
- The emergence of the telegraph business
- The early history of wireless, radio, and TV
- The PC revolution
- The birth of the internet
- The invention of the smart phone
These are all examples of Innovation Catalysts…
But the list of Catalysts goes on:
There are Political Catalysts:
- A Presidential Election
- Tax raises
- Tax Cuts
- New laws
Economic Catalysts:
- Fed decides to lower interest rates
- Positive employment numbers
Crisis Catalysts:
- WWII
- 9/11
- COVID pandemic
Company-level Catalysts:
- Positive earnings call
- New product announcement
- Stock buyback announcement
There are many, many more beyond the examples I gave you here.
Which is great news for you…
Because we can profit from these powerful events – especially in this “weird” sick stock market were experiencing – with what I call Catalyst Trades.
Case in point:
In the early 1990s, high-interest rates, a weakening economy and an oil price shock drove the stock market sick…
So much so that most people missed the biggest Catalyst of the next decade…
The birth of the internet propelled hard-charging tech companies into some of the most profitable Catalyst Trades of all time…
“’90s Winners: Tech All The Way” — The Los Angeles Times
- Like 2,863% gains on AOL
- 8,918% gains on the microchip company Maximum Integrated
- And 10,940% gains on the semiconductor company Semtech
More recently, after the 2008 financial crisis, the markets were as sick as ever…
And a new wave of even bigger Catalysts was forming…
Faster broadband speeds.
Quantum leaps in medicine…
And the ‘Smart Boom” that put microchips in everything from toilets to tombstones pumped out staggeringly profitable Catalyst Trades like:
- Internet stocks like Amazon delivered 1,209% gains and Netflix handed out 3,692%…
- Medtech stocks like Neogenomics multiplied smart investors’ money 1,675% and Repligen shot up 2,069%
- And semiconductor stocks like NVIDIA rallied 1,202% and Broadcom soared 2,037%
That’s the incredible power of Catalyst Trades to pile up your profits sky high….
If you know how to identify them before they hit the mainstream.
For 32 years, I’ve been uncovering profitable Catalyst Trades with clinical precision.
It’s all thanks to my simple 4-Phase Formula.
And in this sick stock market, it’s exactly what the doctor ordered.
In this report, I’m going to reveal this formula for the first time ever…
So, you’re in for a treat.
Let’s dive right in with…
Phase 1: Eliminate the noise
There are 8,024 stocks and millions of ways to play them…
Unfortunately… most of them are just “noise.”
At best they’re going to return mediocre “average” gains.
I’m not looking for “average” profits in my portfolio.
And if you’re reading this… I doubt you are either.
The key is to eliminate all the potential duds and focus on the stocks that have the best chance at bagging big gains.
How do I do that?
I uncover Catalysts.
And that’s where my medical training really comes in.
See when a patient walks in with a cough, fever, and nausea, it’s obvious that they’re sick.
But those are just symptoms.
It’s my job to dig deeper with every tool at my disposal to find the root cause–the catalyst–that’s making the patient ill.
I can run tests…
Request scans…
Ask the patient a lot of specific questions…
And through all of that, I’m able form a picture of what’s going on with them, and diagnose what caused the illness.
In a sick stock market, like we find ourselves in right now… pinpointing the right Catalyst is a very similar process.
The tools I use are different of course.
But they uncover the Catalysts hiding in plain sight.
Events that have the potential to be world-changing…
This process will narrow down my choices to thousands of potential stocks.
The stocks left all have the advantage of having an unstoppable Catalyst behind them.
But make no mistake.
Not every stock with a strong Catalyst is worthy of your hard-earned dollars.
There’s more work to be done to identify the cream-of-the-crop Catalyst Trades.
This brings us to the next big question.
How do I identify Catalyst Trades?
That’s where the next phase in my formula comes in…
Phase 2: Think “now and later”
Here’s what I mean.
When I’m looking at a company that has the potential to benefit from one of these unstoppable Catalysts…
I first look to see if it’s turning a profit (or close to turning a profit) NOW.
But that’s only part of the analysis.
I also make sure that the company has the potential of making even more money LATER.
More specifically:
I’m looking for companies with profits who are ALSO growing topline revenue.
A company that is profitable with growing revenue is already demonstrating that it can adapt and still be profitable.
Putting them in prime position to ride these catalysts long into the future.
The stocks that make it through these two filters alone are nothing short of exceptional.
And most analysts would happily pick them up and call it a day.
But my work isn’t done yet.
Like you, I’m not content with settling for average gains.
I’m only looking for Catalyst Trades with exceptional profit potential.
Which brings us to phase 3 in my formula.
Phase 3: Easy Angle of Attack
In Phase 1 and 2, I talked about how my formula zeros-in on which companies make for exceptional Catalyst Trades.
In Phase 3, I’ll talk about HOW to enter those Catalyst Trades.
I call this the Easy Angle of Attack.
And of course, we want to find the easiest angle of attack possible.
In many cases, the easiest angle of attack is to simply buy and hold the stock.
But that’s not always the case.
See, after 32 years of investing for myself, my family members, and giving countless recommendations to investors just like you, I realized a crucial fact.
A company can have a massive Catalyst behind it AND meet the NOW and LATER criteria…
But just buying and holding the stock won’t deliver the kind of multi-bagger profits I’m looking for.
For example:
Recently, when a CDC study found that Moderna’s vaccine was 94% effective against COVID, the vaccine maker’s stock bumped 7%.
A win is a win. But this one wasn’t much to write home about.
The problem?
The company was just too big for there to be a huge move in the stock price.
But that doesn’t close the door to multi-bagger profits.
We can use another type of investment… one which is widely considered the biggest “open-secret” in investing…
There are over $27 trillion worth of these investments out there right now…
And yet, most investors have never used them in their life…
That’s too bad because they have the potential to multiply your money more than you ever thought possible.
I’m talking about options.
And while some investors look at options as “off limits”…
I’ve been trading them for decades.
And I’ve helped thousands of everyday investors understand the benefits of options.
Heck, I even wrote a book on the topic.
See: options, when applied like the way I trade, have the incredible advantage of taking ordinary gains and multiplying them 5, 10 even 20-fold.
In short, where ordinary buy and hold investing falls short to deliver sky-high profit potential…
Options give you an easy angle of attack to bag MASSIVE gains on a single trade.
Let’s take a look at that Moderna trade for example:
That 7% blip in the stock price…
With the right options trade… you could have banked a sweet 303% gain.
That’s not all.
Look at how options turned these so-so stock gains into monster profits:
This is why I love to keep options in my trading arsenal. They give you extra flexibility to strike on enormous profit opportunities…
Does this mean I only trade options?
No.
There’s still plenty of opportunities to profit big from ordinary stocks.
The examples above serve to show you the power and flexibility options give you to unlock monster profits.
Ok so far, I showed you how I eliminate noise by zeroing on unstoppable Catalysts…
Then I revealed my NOW and LATER thinking to uncover exceptional stocks…
And you just saw how I look for the easy angle of attack to pocket big profits, whether that’s by buying stock or options.
This brings us to the final phase in my formula.
Phase 4: Wide Open Timing Window
There’s no way to get around it. The market will reward us with bigger and bigger profits by correctly timing when we enter and exit trades.
How do I narrow down the best times to get in and out?
I look to the stock charts.
Here’s what I mean.
I like to look at 5 different stock charts until I finally pull the trigger on a Catalyst Trade…
What I’m looking for in these charts is a signal that the stock is primed to takeoff.
Once I get the signal, I look to make the trade.
Make no mistake:
That doesn’t mean you have to be chained to your desk day trading.
There’s still plenty of time to enter the trade.
But placing it is only half the story.
I also use the stock charts to tell me when to exit the trade.
That way I don’t hold on for too long.
When done right, Phase 4 of my Formula helps narrow down the timing window allowing us the potential to bank maximum profits.
Let’s tie everything together with an example that delivered 2,021% annualized gains
We’re going to look at my very first trade recommendation at Investing Daily…
The stock was the microchip testing company PDF Solutions.
To begin, let’s Eliminate the Noise.
At the time, Congress was debating the Build Back Better package.
“The push for two big infrastructure bills [are] getting all the attention in Washington right now” — The Wall Street Journal
No matter which side of the aisle you lean, you can agree it was all over the news.
Will it pass? How much?
The stock market bounced up and down on the news.
It’s easy to get lost in that kind of noise.
But behind all the headlines, an unstoppable Catalyst was brewing.
You see: No matter if it was $3.5 trillion or $1 trillion, the Build Back Better bill meant a lot of government spending…
And all that cash was likely going flow to key industries that advanced America’s interests both locally and abroad.
I zeroed in on one of the important industries that has the potential to make or break America’s future: microchips.
The news was filled with headlines about the microchip shortages.
“The global chip shortage is starting to have major real-world consequences” — CNBC
“The microchip shortage explained: How it’s impacting car prices and the tech industry” — USA Today
“Worsening Computer Chip Crisis Shows Supply Chains Are Still At Risk” — Forbes
Out of all the problems that caused the chip shortage…
I uncovered the most important.
“The World Relies on One Chip Maker in Taiwan, Leaving Everyone Vulnerable” — The Wall Street Journal
What’s the solution to this huge problem?
More microchip makers…
Preferably microchip makers right here in the United States of America.
A group of microchip industry leaders even wrote a letter urging Congress:
“To be competitive and strengthen the resilience of critical supply chains, we believe the U.S. needs to incentivize the construction of new and modernized semiconductor manufacturing facilities and invest in research capabilities.”
In plain English: We need to build microchip factories in the USA, NOW.
Which means billions in infrastructure money could flow into the microchip makers.
Together, it all looked like a sure-fire Catalyst to me.
So, I set to work finding a potential winning stock pick…
And one quickly emerged…
PDF Solutions.
This Silicon Valley based company makes software that helps microchip companies with… you guessed it… manufacturing.
It passed Phase 1 of my formula.
But it was time to apply Phase 2: Think Now and Later.
First I looked at what kind of money PDF Solutions was making right now.
The company was not profitable, but it was nearly at breakeven with positive cash flow.
It checked the NOW box.
And topline revenue was growing.
So, it checked the LATER box, too.
PDF Solutions had the right stuff.
Next up was Phase 3: Easy Angle of Attack.
This is where a seemingly good stock pick can flop…
Or turn into a LIFE-CHANGING one.
As was the case for PDF Solutions.
The price was right, and the profit potential was huge. So, I decided the best strategy was to buy the stock outright..
But before I pulled the trigger on the recommendation…
PDF Solutions had to pass the final phase… wide open timing window.
So, I dove into the stock charts…
And what I saw was a work of art.
Because they showed that money was moving into PDF Solutions…
In fact, money was moving in at a time when the rest of the stock market was selling off aggressively.
In short, PDF Solutions was primed to break out.
That sealed the deal.
I recommended PDF Solutions…
And within a few weeks, the stock price went up…
The annualized gains were 2,021%
Not a bad first trade wouldn’t you say?
But I have something even better in store for you at the 2022 Profit Catalyst Symposium.
I used this exact 4-phase formula to identify a dozen “cream-of-the-crop” Catalyst Trades…
And on Tuesday, January 25th at 1pm, I’m going to crown my #1 Catalyst Trade for 2022 and beyond.
This one simple trade could pile profits as high as 2,022% into your portfolio.
It’s the best way I can think of to start off 2022 with a bang.
Remember the Profit Catalyst Symposium goes “live” on Tuesday, January 25th at 1pm EST.